Oil prices are under pressure from rising inventories

 
Sinopec News, July 10, 2020 - Crude oil prices stabilized near $41 a barrel in New York as rising U.S. crude inventories raised new supply concerns and global infections continued to surge, Rigzone reported on July 9.
 
Inventories in the US rose unexpectedly last week as inventories at the key storage centre in Cushing rose for the first time since early May, according to government data. Oil prices have been trading in a tight range this month.
 
Oil prices are trying to extend their rally after recovering from a plunge below zero in April, but rising cases could hamper a recovery in demand. Some predict a long-term recovery in oil consumption, with StandardChartered estimating that consumption next year will be at only 2017 levels, meaning the outbreak will disrupt four years of growth.
 
The Energy Information Administration said on Wednesday that U.S. crude oil inventories rose 5.65 million barrels last week, while Cushing stocks rose 2.2 million barrels. Still, gasoline supplies showed the biggest drop since March, with the biggest drop on the East Coast, suggesting more people are traveling.
 
"We are not out of the corner in terms of coping with demand disruptions and the rise in US crude inventories to near record highs is a concern," said Howie Elee, an economist at OCBC Bank in Singapore.
 
Nymex August West Texas Intermediate crude fell 8 cents to $40.82 a barrel at 7:50 a.m. Euronext Brent crude for September delivery was little changed at $43.25 a barrel after rising 0.5% in the previous session. Brent three-month contracts carry a contango of 59 cents, with spot prices lower than forwards.
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